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Who’s Using Banks? For What? Who’s Switching? And Why?
Posted By Editor On August 7, 2012 @ 12:02 am In Facts & Data,Featured Articles | No Comments
Worldwide, the number of customers planning to change banks has increased from 7% to 12%. The proportion of customers planning to change banks has increased since 2011, with 50% of customers globally citing high fees and charges as the primary reason.
Banking customers generally demonstrate increased sensitivity to high fees or rates on deposits and it is the primary reason that most switch their primary banks. U.S., Canadian and European banking customers cite poor rates on accounts as an important factor in switching banks.
Customers appear to want more than a better deal; they want the flexibility to shape the relationship, contacting their bank whenever and however they choose. They may prefer online channels for simple transactions, but demand high-quality, personalized services for more complex transactions.
Worldwide, 34% of customers say they have changed their main banking provider and 74% have done so in the last 10 years. The overall figure is marginally lower than in 2011 but it conceals some wide variations across countries, with attrition rates rising significantly in several key markets. Specifically, in both the US and Canada, the number of respondents who have changed their main bank has increased from 38% in 2011 to 45% in 2012.
Although Ernst & Young found that overall satisfaction with banks remains high, trust levels remain low. Globally, consumer confidence in the banking industry has dropped 40%. In Europe’s more beleaguered countries it’s nearly double that — a 72% drop in Italy and 76% in Spain.
In the U.S., just slightly more than half say their confidence in the banking sector has decreased over last year. 9% say they are more confident, and 40% say there’s been no change in their feelings.
Banking consumers are diversifying their relationships — spreading their bets around, as it were. Customers using only one bank have dropped from 41% to 31%, while those with three or more have increased from 21% to 32% since 2011.
How can banks provide a better customer experience, one that reduces churn and attrition rates? Ernst & Young offers banks this advice:
Researchers say that in order to retain their customers, banks must adapt their business models to cater to increased demands to accommodate a wide range of customized services and products. The models most commonly pursued by banks are (1) based on low-cost competition, or (2) on high-touch service and others on accessibility. Large, full-service banks need to defend market share against new entrants and those offer greater specialization, while retaining the ability to meet a wide range of needs and sustain profitability.
This is Ernst & Young’s latest survey of retail banking customers around the world. Building on their previous global customer survey in 2011 and our European customer survey in 2010, the study  examines the views of more than 28,500 banking customers in 35 countries, gathered in March 2012.
The survey emphasizes the following questions:
You can download the complete 62-page survey instantly by clicking here  (no registration required). It’s worth a look.
Article printed from The Financial Brand: Marketing Insights for Banks & Credit Unions: http://thefinancialbrand.com
URL to article: http://thefinancialbrand.com/24704/ernst-young-global-banking-customer-study/
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 the study: http://thefinancialbrand.com http://www.ey.com/GL/en/Industries/Financial-Services/Banking---Capital-Markets/Global-consumer-banking-survey-2012--The-voice-of-todays-banking-customer
 by clicking here: http://thefinancialbrand.com http://www.ey.com/Publication/vwLUAssets/Global_Consumer_Banking_Survey_2012_The_customer_takes_control/$FILE/Global_Consumer_Banking_Survey_2012.pdf
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